Wealth28 Comments

Short term trading in the Nigerian stock exchange (market) is what most people are advised to go for. You can make quick money from speculation quicker than you’d ever imagine. It is possible to get some stock unit, let’s say for N200,000 and quickly make gain by selling it within the next few weeks or months.

However, it is possible to buy some unit for N200,000 and watch your money deplete into half within the next few weeks. So, this is a lose or gain approach. But if you are well informed about the ins and outs of investing in the stock market and the Nigerian stock exchange, it is possible to avoid the risks and make quick cash.

SEE ALSO: Investment Opportunities In The Nigeria Oil And Gas Industry

Some people prefers to trade on high cap stocks, while others prefers trading on penny stocks.Whichever one you chose or you decides to trade on both, the truth is that you can make money if you are wise and informed about trading in the Nigerian stock market. Now, let’s get over to the things you will need.

What You Need To Start Investing In The Nigerian Stock Exchange

There are three major things you will need to start trading. There are as follows –

1. Get a Stock Broker/Brokerage Company

The Brokerage firm or your stock brokers acts as the intermediaries between you and the stock market. They handles the intricate parts of your transactions and get commissions for their efforts.

The Duty of Your Stock Broker: Your Brokers will help you open a CSCS (Central Securities Clearing System) account which in turn would make it possible for you to buy stocks, you may not be able to buy stocks on your own; you have to go through your stock brokering firm.

If you are buying from the primary market, that is the one that the company advertises directly, in filling the forms, you must state the name of your stock broking firm and your CSCS account number. So, you must have a stock broker even if you are buying from the primary market.

For the secondary market, you must inform your stock broker, who will then go to the stock exchange and buy your desired stock on your behalf on a regular basis.

2. Open Investor’s Account

The moment you decides to trade in the Nigerian Stock Exchange, you are becoming an investor. Therefore, you will need investor’s account. An investor’s account is an account that is unique and tied to your name as an investor. It is normally opened for you along with a CSCS account with which your stocks would be moved in. It is opened for you by the stock brokerage firm or broker whom you have assigned to act on your behalf. All transactions done on your behalf would then be recorded against your name in your investor’s account.

SEE ALSO: How To Make N10,000 In Real Estate Investment In Nigeria

Each time your broker wants to buy stock on your behalf, he buys it into your investor’s account. The account is for both equity and bonds.

3. Secure Trading Capital

You and I know what that is. There is no technicality involved in explaining that. Depending on the volume you want to trade or what I will call the amount of risks you want to take, you will need enough trading cash that is proportional to your trading options.

More than anything else, knowledge is your power in this business. You must be in the know, constantly updating your knowledge of the market and be in-tune with the latest trends. You must be good at spotting opportunities and possess the ability to predict trends.

“Buy the rumours and sell the news”. That’s a very popular saying among investors. It means – Do not trade on sentiment.

Making Money With The Nigerian Stock Exchange

The game is simple! Spot a good commodity in the market, predict accurately it’s movement, buy, and sell at the right time.

Let’s take for example you bought Ashaka Cement shares worth N200,000 at the price of 1.00 kobo per share, if by next month the price appreciates to 4 kobo per share, you’ve made 4 times your money after selling, which will amount to N200,000 x 4 = N800,000

On that trade, you will pay a total commission of about N,8000 and pocket your profit of N592,000 from that single trade.

Next article will shed more light on buying and selling. Drop me a comment or questions below.
+Darlinton Omeh

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28 Comments

  • Anonymous January 30, 2015

    Heya i am for the first time here. I came across this board and I find It really useful & it helped me out much. I hope to give something back and aid others like you aided me.

    Reply

    • Emmanuel October 12, 2017

      Hello Anonymous…. can you kindly guide me. I just contacted a broker. I was told I have to open an account with them with minimum account opening of N50,000. Can you kindly guide me

      Reply

  • Anonymous January 30, 2015

    Amazing! Its in fact remarkable article, I have got some idea on investing in stock in the nigerian stock exchange from this article.

    Reply

  • Emmanuel January 11, 2016

    Is it possible to change or have another stock broker apart from your first one?

    Reply

    • Anon April 25, 2018

      Yes it is. Contact your new brokers and they will help with transferring your account from the old to the new

      Reply

  • obi January 20, 2016

    how to i approach a stock broker or how can i locate their firm.. am in awka anambra state… am really getting intrested in stock exchange and wanna make real money through it.. am a young potential man .. hope i can start with a small capital of 50,000 or less

    Reply

    • Anon April 25, 2018

      Yes you can start with N50, 000. Visit the NSE website for a list of brokers. Filter this list to get the ones closest to you. Likewise you may decide to trade by yourself using existing online trading platforms however you need to deeply understand the trading markets.

      Reply

  • joe February 28, 2016

    how can i start

    Reply

  • Tee May 16, 2016

    how can i start?

    Reply

  • Jay May 17, 2016

    you can start by getting a good broker. Google to check the one nearest to you.

    Reply

  • Wealth June 25, 2016

    Good morning. My name is Wealth. I knew little or notHong about the stock market until I just read this article on the 3 major things you must have if you want to start investing in the Nigerian stock exchange market. Thank you so much. I am online now looking for the nearest stock broking firm around me. God bless you and thanks a lot for sharing. You are helping so many people. God bless you.

    Reply

  • Williams August 13, 2017

    Quite important for everyone to embark on wise investment. I am interested.

    Plsease, how do I locate a functional and dependable Broker? Also, what cautions should I employ in stock exchange trading?

    Thanks a lot.

    Reply

  • Bongdap December 26, 2017

    Is there no way of creating an account online and buying stocks directly myself than having to contact and send emails?
    I need to track everything myself than putting fate in someone else.

    Reply

  • Usman January 3, 2018

    I want to invest where do I start. I understand that I would need a broker , where can I find one?

    Reply

  • Mr solomon January 15, 2018

    pls how can one know what to invest on even when stock broking firm is not very informative enough?

    Reply

  • Ay January 23, 2018

    Can I start with #10,000 ?

    Reply

  • shweta dubey February 17, 2018

    Hi Dear,

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    Reply

  • Olu February 23, 2018

    What is the minimum number of shares i can buy

    Reply

  • Christopher Akagha February 28, 2018

    hi,
    how much must have before start.
    Secondly, I would like to learn the trade myself.

    Reply

  • Joseph Etim March 25, 2018

    My this simple article you have just created a millionaire in me. Thanks you very much.

    Reply

  • Humphrey April 3, 2018

    How do I get the broker online or offline

    Reply

  • Temitope April 12, 2018

    This site is just like God sent to me that unveil what has been boarding. Thank you

    Reply

  • noah favour April 13, 2018

    hi… am favour please how can i be connected to the broker

    Reply

  • Anon April 25, 2018

    Some brokers do specify minimum amounts as much as I think there may be other brokers who will specify even lesser amounts. Check for list of active brokers on NSE website for other options.

    Reply

  • Fred Jones August 10, 2018

    Hello Anonymous, I would like to trade by myself. Can you direct me to an existing online trading platform please

    Reply

  • Bolade January 20, 2019

    Thanks for this article share to educate both existing and beginners on what to do on investment portfolio it is very informative article share I will be delighted to have a stock broker kindly connect me

    Reply

  • Golden January 28, 2019

    This was useful.thanks

    Reply

  • Rupet March 27, 2019

    Just being curious. I would like to know the risks associated with buying shares.
    And also how can this be traded online.
    Thanks

    Reply

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